Language education and economic outcomes in a bilingual society

Poor economic performance of minority groups and large economic disparity between these groups and the majority group are major concerns in most countries. In many of these countries, the mother tongue of the latter group is the common language in national business and in inter-group communications. How much weights should be placed on common language education and on ethnic language education is a crucial issue in school education of minority students. This paper develops a model to examine the issue theoretically. It is shown that balanced education of the two languages is critical for skill development of individuals with limited wealth. It is also found that balanced dual education is desirable in terms of earnings net of educational expenditure and consumption, only when the country has favorable conditions (TFP is reasonably high and education is reasonably effective in skill development) and only for those with adequate wealth. Common-language-only education maximizes net earnings and consumption of those with little wealth, and, when the country's conditions are not good, maximizes the economic outcomes of all. Policy implications of the results are discussed. The paper also examines implications of the asymmetric language positions of the groups for sectoral choices and within-group inequalities.